More on the Tax Panel

President’s Tax Panel Proposes Broad Reforms – Center for American Progress
Considering the backward direction of the Bush administration’s tax policy over the last five years, the proposals from the president’s tax panel are something of a relief. The last five years of tax changes have led to declining revenues, massive deficits, and an increasingly unfair tax code. The panel’s recommendations are at least neutral on those major choices.
The president’s tax reform panel yesterday met for its last public meeting and made public specific outlines of what it will be proposing on November 1. While many of the details are still to be determined, the panel will recommend two distinct options: 1) a reform of the current income tax, and 2) a modified “progressive consumption tax.” Each policy, in different ways, shifts taxation away from capital and savings, and onto work and consumption. The second option that moves away from a pure consumption tax and closer to an income tax by retaining some taxes on capital gains and dividends at a 15 percent rate.
While the full proposals will take time to fully analyze once full details are presented, they present one major caution and one major concern.
The caution is that while there are many parts of the panel’s proposals that seem to have significant merit—especially in ways that might simplify the code by consolidating existing credits and incentives—we fear that the administration and a right-wing-led Congress will ultimately undo politically risky suggestions, or pursue only the parts that fit their prior ideological biases.Read the full statement (PDF)